Latest / Profit Points Podcast / Revenue Goals vs. Profit Goals: Which One Actually Builds a Better Business?

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Revenue Goals vs. Profit Goals: Which One Actually Builds a Better Business? · Profit Points Podcast

• 0:00
  SPEAKER_00: Hey, glad you're here.
• 0:01
  SPEAKER_00: This is Profit Points, and I'm Megan Schwant, your accounting sidekick and certified Profit First Professional and Fix the Snext Advisor.
• 0:09
  SPEAKER_00: If you're a small business owner who wants to actually understand what is happening in your business financially, not just survive it, but genuinely get it, you're in the right place.
• 0:20
  SPEAKER_00: Every episode covers one concept, uses real numbers, and ends with something you can actually do.
• 0:26
  SPEAKER_00: That's the deal.
• 0:27
  SPEAKER_00: Let's talk about today's topic.
• 0:31
  SPEAKER_00: Revenue goals versus profit goals, which actually matter.
• 0:38
  SPEAKER_00: So this time of year, we set a lot of goals, but most sales do not automatically create a better business.
• 0:49
  SPEAKER_00: So when you're setting your goals and when you're thinking about your goals or the goals that you have set, I want you to think did you make a goal that just says, I want more money?
• 1:00
  SPEAKER_00: What most CEOs mean when they say they want more revenue, it doesn't necessarily mean more profit or stability and sometimes not even peace.
• 1:13
  SPEAKER_00: Sometimes we're so focused on that high-level goal instead of really focusing on what actually matters.
• 1:22
  SPEAKER_00: I'm Megan Schwan, your accounting sidekick, and this is the Profit Points podcast, where we talk about growth that actually supports your life, not just your vanity.
• 1:34
  SPEAKER_00: Revenue goals are loud, they show up as big numbers, public milestones.
• 1:42
  SPEAKER_00: If it if I hit this, then I'll feel successful.
• 1:46
  SPEAKER_00: But the problem with that is that revenue-on goals create pressure, not freedom.
• 1:54
  SPEAKER_00: Why?
• 1:55
  SPEAKER_00: Well, they don't account for things like capacity, they ignore margins, which we've talked about before on this.
• 2:04
  SPEAKER_00: They push you to sell at any cost.
• 2:08
  SPEAKER_00: And when sales become the only focus, stability quietly disappears.
• 2:14
  SPEAKER_00: So why do revenue only goals create pressure and not freedom?
• 2:20
  SPEAKER_00: Well, I'm so glad you asked.
• 2:23
  SPEAKER_00: When your own your only goal is revenue, every no starts to feel personal.
• 2:29
  SPEAKER_00: Have you ever been there?
• 2:31
  SPEAKER_00: You were having a sales call, or maybe several of them in a row, and you keep getting this no.
• 2:36
  SPEAKER_00: When you're like trying to hit revenue-only numbers, that starts to feel personal.
• 2:43
  SPEAKER_00: You when you think this way, you tend to start doing things like discounting to close deals, saying yes to the wrong clients, overloading your calendar, and sometimes ignoring the delivery strain or your capacity.
• 3:01
  SPEAKER_00: Revenue goals don't ask how the money is made, they only care that it's made.
• 3:17
  SPEAKER_00: But now what?
• 3:19
  SPEAKER_00: Let's dig in to what to measure instead, what goals to set instead, things like profit, capacity, and margin.
• 3:28
  SPEAKER_00: So profit-focused CEOs ask better questions instead of how much can I sell?
• 3:34
  SPEAKER_00: They ask, how much can I deliver well?
• 3:39
  SPEAKER_00: That's something to think about first.
• 3:41
  SPEAKER_00: What margin do I need to feel stable?
• 3:45
  SPEAKER_00: What level of income actually supports my life?
• 3:50
  SPEAKER_00: We need to ask ourselves, what are the key metrics to reframe around things like profit, which talks about what you keep?
• 3:58
  SPEAKER_00: You can have a million-dollar business and only be keeping$50,000 at the end of the day.
• 4:04
  SPEAKER_00: Does that sound like a successful business to you?
• 4:08
  SPEAKER_00: Capacity, what can you handle?
• 4:11
  SPEAKER_00: Margin, which is what makes the effort worth it.
• 4:15
  SPEAKER_00: How much are you actually keeping?
• 4:18
  SPEAKER_00: What does that look like for each job, not just overall, each project, each customer?
• 4:24
  SPEAKER_00: When these are clear, sales feel grounded instead of desperate.
• 4:33
  SPEAKER_00: The past couple of years, I had big revenue goals, and yet I kept coming up short.
• 4:40
  SPEAKER_00: So this year, even for me, it's it isn't a revenue goal.
• 4:44
  SPEAKER_00: For me, it's a team goal so that we can do exactly this.
• 4:49
  SPEAKER_00: We can focus on delivering well, increasing our capacity.
• 4:53
  SPEAKER_00: And in turn, I know that the revenue will follow.
• 4:56
  SPEAKER_00: But in the meantime, I'll be way more at peace and within my capacity while achieving my other goals like getting healthier and spending more time with my kids.
• 5:06
  SPEAKER_00: So focusing on not just that revenue number, but all of these other things that make up that revenue and profit and margin, those are the things that I personally am focusing on too.
• 5:18
  SPEAKER_00: So let's get into how to set goals that don't sabotage your energy.
• 5:22
  SPEAKER_00: And here's the shift: like mine, your goals should protect your energy, not drain it.
• 5:27
  SPEAKER_00: So give this framework a bit of a shot.
• 5:30
  SPEAKER_00: Number one, set a profit goal first.
• 5:33
  SPEAKER_00: Number two, back into revenue based on margin.
• 5:38
  SPEAKER_00: And three, cap sales at your real delivery capacity.
• 5:43
  SPEAKER_00: And if you're not sure what some of these things are, you need to take a little bit of time with your numbers to figure this out.
• 5:50
  SPEAKER_00: This is how CEOs grow sustainably and not just accidentally.
• 5:56
  SPEAKER_00: This week, I want you to take a look at your goals.
• 5:59
  SPEAKER_00: And if you have a revenue-only goal, if you said I want to make X amount of dollars this year, maybe try switching it and say, I want to keep X amount while working within my capacity.
• 6:13
  SPEAKER_00: You can also ask yourself, what does enough actually look like?
• 6:17
  SPEAKER_00: What am I willing to say no to in order to protect profit?
• 6:23
  SPEAKER_00: Think about scope creep.
• 6:25
  SPEAKER_00: Do you need to have better outlines on your services and what that actually entails?
• 6:31
  SPEAKER_00: That you're not constantly giving, giving, giving without getting a return, right?
• 6:36
  SPEAKER_00: Revenue can grow your business, but profit is really what supports your life.
• 6:41
  SPEAKER_00: If your goal feels heavy, maybe it's because it's incomplete.
• 6:46
  SPEAKER_00: So take a look at that.
• 6:49
  SPEAKER_00: And like always, if you need more support or information or any of that, you can look at our or join my Facebook group, your accountingsidekick.com.
• 7:01
  SPEAKER_00: Or if you want to talk a little bit more about your sales goals and how that relates to real profitability, that's exactly what we help our clients do.
• 7:11
  SPEAKER_00: So feel free to book a call by going to chatwithmeg.com and we can talk more about that.
• 7:18
  SPEAKER_00: Otherwise, this is the Profit Points Podcast.
• 7:21
  SPEAKER_00: I'm Megan Schwan, your accounting sidekick, helping you build a business that grows with you, not at your expense.
• 7:30
  SPEAKER_00: I'll see you next week.
• 7:32
  unknown: Bye.
• 7:32
  SPEAKER_00: All right, that's your episode this time.
• 7:34
  SPEAKER_00: Don't forget your action step.
• 7:36
  SPEAKER_00: I want you to actually do it, not just add it to the list.
• 7:40
  SPEAKER_00: If this episode was helpful, share it with a fellow business owner who needs to hear it.
• 7:44
  SPEAKER_00: And if you're ready to go deeper on your specific numbers, book a strategy call with Sidekick Accounting.
• 7:49
  SPEAKER_00: Go to chatwithmeg.com, and I'll see you next time on Profit Points.